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Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090\122-2 BEST COPY AVAILABLE Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 , e 6 Mit MLR Ws The cii.i.and Beyond" 6,,2?17,4 FA.A..?-It en?-?-? - 4 ija, )(A.404:141.ciA01?.? As troadsmat over tho 01111111LIMIDNIXTMOSK ihmilsy, July 21, 195C? 1102 'WI 1DT 11113MID DT Fran Studio 61 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 chard C. Hot A CBS ws CorrsspoAtnt, formany year* a reporter in Garalny and Russia, recently toured /Mail Argentina, Chile. Peru and Uruguay for the program. Daniel OW Nom Moscow 955.195?), ourrently three- years Washington D.0 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 war upon you in the peaceful field of trade win over the United States. The threat to the ICBM. but Lathe field of peacefUl pro- Leis this, and it will prove the euperiority of oceesion, an words had a propagandist ring to them. But a few American in special eharge of knowing what the Ruseians are doing and planning, told the United States that thou. words vere in deadly earnest. IA s speech, NO. Allen Bolles, the head of Americe's "-----moyertemammomw Central Intelligence, said that the United States has fased no greater threat in its peacetime history than the war of trade and aid that Ihreshahav ea frankly declared upon us last Fall. In the past week, the scunting crisis in the Biddle Seat has absorbed the world atteetion. By most of the evidenos that we have the timing of that crisis was almost inadvertentt Russia had not thought it would heppen when it did, ass.? is believed to have been taken by surpriee by the tieing as welters. The best informed opinions we have boon able to gather area It will not cause big Wen ? 1 ? Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 their sD) For trtion; and her main instrument Ruble War to aat.?d:free economy. aim to use tion an a politi&1 weapon on a sai.e without . On that enduring Soviet len to our we report to you now the Rdble War look in the areas of each of to def First, how the eorreepondents now about to report to us First'ttMtan Burdett. ADM, In the Middle Best - ever since the last big oriel*, the &iez iiii, the door has homicide open to Soviet penetration and the siaehave been streaming through that door. Today, they have list of or than eighty development projects three key countries, Syria, iiigypt and Temen1 In those same countries we are doing thing SMIETW EALISCWAt d than the Communist bloc and basi were doing a better job. But the flat is the Russians are tieg a bigger run for the ruble than we are getting a bang far the buck. SKIM Richard C. Bottelet HOTTBLh In South *masa the flaseians are only beginning to penetrate. A irety shrew observer in Chile told me, *The Soviet Union *Undo in Latin America today Tabers it stood in the Middle at five years ago. The feet? is it4s coming in like a harpoon Z Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 til on which Russia shown its hand; shown that when a nation dos ta.k Soviet economie sid it mgy find itself paying Mosoowts political prt DMITRI Daniel Schorr* In Russia - it looks as though economic penetration in a licy, not to he altered by the, shiftlog winds in the cold 4 economic ogpacity to make trouble ter us is in- =ROM, borne of those statements ?trot frau the area where the 5402 risi. eave Russia her opening and where the f rebellion now, momentarily, distracts from the abiding of trade war. the Biddle -Zest* Winston Burdett* aUEDzTr The story- of these twenty months. since Sues is briefly thus The United has in :effect. boycotted lapt.and. Syria the the British have been excluded from the: area;ad the ve mated ins, Here ere some of the vbtch the with their eateIlitee have already gotten off the ground in Arab countriest in Syria, Russian teOhnielens in tour Ilyushin plane* ere buey surveyingt wing the entire eountry. Bulgaria engineers are building everythieg from silos to airporte* iRgypt. ultramodern Soviet oil, rigs ere drillieg in the desert! and, RUMWATI, spirt* ere drawing plane for the espansion, of Agyptie ail refineriee: their first move in the field of- Middle laster oil* The Casaba have 3 Approved For Release 2000/09/11: CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 uract -ti) tting up a huge ? Soviet factory Athousand miles to the south in building a modern port on the Red Sea first big pbUc wort* project that this flasite kingdom has un blOwny, from the coast to the eapital, i* built by Chinese Communisits. the firstpoizt about the Soviet oft is that thee* Ronsidutdommanpment projects in Sgypt for example, are not just selected Showpieces to make 4 propaganda *lath They cover the whole sow of Rgypt *modern economy. They were selected by the Sgyptians se part of their own inftstrial Ptve? Tear Plan. The Soviet aid i* not a grants it's not charity. The Russians are offering lompatermeredit, so the Agyptians can get two things* technical help and machinery. The total credits a hundred and seventp.sight million dollars, movers more than a quarter of the cost of the Five-Sear Plan. Repayment is over twelve years. Interest, two and & half per cent. The standard rates on Western loans are from four and 4 half to five and a half per cent. fnare's second way idtieh tho Russians have tightened an 4gypt. They have given Sgypt a market for and most important emport cotton, at a time no aotton outlets in the West ind# they have ru with wheat and oil at i tiz. when the United reasons nade it luipou?ble for &apt to gat West. these 41117Pt ua be9n tbisy S only 2IA of tbfr 'mottos Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 ? 4 ? Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 I( DONTID) i96, it sources of foreignarobange. i. of iadep.ndt of the ieat baa ben converted into deepening depeedence on the Sast. Several things have impelled Semler to turn Zasts his need for industrial assistance, and Arab also bed immediate eoonomic reasons lie, ehieh controls world cotton prices, has vulnerable to the Soviet trade straegle hold in the iong r, bavevor,aidmey be the more sigmificant of Moscow's two .00nossit 4 major segment of i3pt's industrial economy will beano Veviet-based under her present Five-Tear Flan Russian La eaten and Russian kerosene ie burned up, but Soviet apinning miUiaM iron smelter*, steel plant and refineriee and shipyards, these are permanent installations that establish a permanent rolatioei. abip, with Egyptian factorise dependent on the Soviet bloc tor spares. They Ow the Ruesians a permanent base. If the present program works well they mill seek to expand that boob and they will gain a new economie and political leverage in a country that is booming or nor. the gateway to Africa taZjSC1t!(t What is happening in the Middle at tedgy, could men in the Aar East If the Middle Sast is the immed1at4 Soviet target, certainly the biggest termn of area people and Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 vAusec -TB door targets more than fourteen milliom square milas istrotohing from Indonosia to Afghanistan; people, about onewciuszter of the world's population. Ibis is the heart-land of neutralism. Tho largoot grouping of newly-bsdependent fbrner eolonlos; long an rationalism and poverty, short on administretion and economics, The United States has pumped more than a billion dollars in 000nomio aid into this area since World War Two. Until 1955, we ...the Vast virtually the only aid dispenses.* in the business. Then, Ihrushohev and Bulganin toured Asia like a Santa Claus acts offering hospitals and atoel mills barter trod. And credit at lower interest rate than ours Tho main Soviet targst in tho area - the jaekpot -is India. Three years ago* &mint aid to India amounted to $116 million. Sine* than, it has piled up to $295 millions almost three4ourths the total of our aid to India over the same period. Sough]; this is the proportion of United tee and Soviet bloc aid to seven nsutral nations .. seven neutral. ain Um*. Sot *very Coamnnist blot: deal turned out to be as es it aounded. But hy and large what tho Soviets promised they delivered ...usually tooter than we did And while our aid is appreciated tv sober economists the Russians r. playing to the gallery and stooling tho bows. Dat as show you bows Cambodia. Sere is Buddhist Cambodia. So neutral it doesn't recognise Borth or South KOMI- at or West Gornany4 Communist or Mationalist China, tut accepts aid from both side*. We helped build thie hospital for huddhist monks. fted China supplied the surgieal equipmont inside. Our main Lid effort is an important nsw road, 132 miles through the Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 - 6 - Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 KAI.= Tip) jungle from Pnompenh the capital to a new seaport the Trench are bull.ding. But this $5 million hospital Bussian gift* Mill in themodel :nage is getting just as much publicity. But Cambodians are rightly not concerned about keeping aid in sepa.rate compartments, so American aid cement is going into ?Lizi t1 Raemian hospital. If that wes a split, hervIs a bigger an. aid goods, tile, porcelains, sawing emehines ohinawareo ro cares a few blocks from the Isceria3. Cause for an invorties. tion perbapsA except that this hoppotil to be Commemist aid and Communist aid programs weer hare to worry about critic* on the home front. Burma. Theme foundation stones were the beginning and the end of an AltiOrialtO hospital IA Rangoon. The Burgles* stopped all rtcw aid in 1953 ? asked it back in 19%, a bit disillusioned with liaise:Ian buster trade* Bow our aid program ma the Russians. t we harm no dieplay to match this one in p3Ain view or OovrmsAt otfioss in %Lagoon The Russians oome bearing gifts end a* In all Sczthut&sing their ocameratiel personnel outnumber our five to eoil reclamation project cannot notch the glamor of a. gift tcbflo oul school being with &mien tool* and the haip of aIaa technicians* to be staffed naturall,r ? by Ituselen teober. AU to be paid for some 4ey ky return gift of Burmese by the tug Is now standard Bosnian .quLpt. In no the lamb pathway from 1113$84.a to India $oviet id tapa s.Cur in effort t? sn irriipAtion project this rt* 1nd anew. raw *femme korat about It. blast Afghans can't read. But at tbay can see are these Susaian busses Approved For Release 2000/09/11 : CIA-gDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 RALISC ) mme 4 Soviet jects ha cornered aot of the wheat and put hundreds of looal bakers out of business the -fghans really don't like the bread ?- it's soggy inside* In Iadia the Rammians don't make manyTheiz ii till less than half of our total aid but it's skillfully 4 The showcase project is this *dial Steel Mils part *eondrive4ear Plan, towards which Russia is lending Fifty thousand Indians employed on the t will produce one Uio,a tons of steel mirian standards but one...fifth of India s ion.What ideating* Rhilai with Russia is not but350 aussian technicians helping to too happy to tell you the Buselans arhe paid on .i1 'r amignments hat th Rumaians live modestly S. two-family houses, three rooms to a family -ander conditions sst overseas American* would scorn. Theoretically the Resew are only supposed to advise the Indians how to go about the job threogh Raglish present steel speaking Russians, ut at of themre do,tiiiyoursoalf types like the fellow perched ci the outside of this blast :armee The furnace incidentally will fire up in Decemberor ehedule, nd everywhere, incredible as it seems, the bureaucratic Approved EastRieleuse424100tOlkitingeth-RDP688414549A0CM46.000402201 in 00 8 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 $OiOs 1 think there is a big gsp between consitment and it is for this reason perhaps? that you do not reap of good will you could of course. With ths tjaviet Union so got the impression that their goods before the ink of thso contract driod 4P. bandrio, vs call Communist aid ocoonosic eall our aid efoonomis eggrecaiost. What do you think our so are? 30katER101 WW1, you ogress with ma that tibia is not oaey to mover that question. it if I venture to svis I would evect that the 3oviet Union aro out to prove to the world that economi relations between countries would oleo be based upon Socialist principles. Cu the other hand,I upset that the United States aro sell aware that thoy oan only sustain their 8000,0147 if the ?their parts of tho world are also on a high level of economic cbsvelopment. I think for the United Btatee it is a matter"Or---' .nU.ght.aed .s1t-intest. Prosperity after all ia the host tool to preserve democraoy 9 -- Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 n is the Ws of d, Dr Bostandrio, is t up for Weat agreement that doubles its from one to two pper mat of a neutral Asian, friendly to the tostion is very di our 121 billion Mershall flan the foreign aid program in history. feet. Aa a result West Zemke the Wussians. Trade yes, to a this Spriug signed a three-Tear di th Mbsoow. But doubles it oar Own frreign trade. Aid? There's been little opportunity for Bbsoow, so far, in Europe. That is, with two notable exceptions One in Ioeland, a reluctant partner in our Atlantic alliance. A tiny country, not very important on the economic ledger*, but very important on the pap. It lies midway along a direct Una or air attack from Bessie to the United States With the air bass, that we now have there we can out off attack. In Soviet hands, as an air or a submarine base, it could threaten a* ~tautly. Soviet hands. It lives lowland has, had great trouble lolling the oatch of its fisheries cept to Rummies In 1952 Iceland meld nothing to the Russians .oday one-ithira of its trade is with the Soviets. If Nascow topped buying new, iclandls eaanapy would almost collapsei, To fortify the econoey and to increase Iceland's dependence on economically, Iceland is slipping into fishing. But for the last six years, Approved For Release 2000/09/11 : CIA-REI6S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved LSES4A(COT,D) he aiao 0 lonetera credit to 1 s big chunk of .any iar a country of only one hundred and sixty thousand The other target of the 3ovit bloc in Amoy." the chief o, has been the maverick Comma* oountry1igpaitvie. And political strings attached to Soviet economic aid have plain sight. after Ihrushohev literally kissed end made up itth to in 1955, nothiog, it seemed, was too good for the *mow offered to take the goods that the Ingoslavs seU eleowhere, even including livovotz the local And in exchange, Russia offered to eapply Tito with erittcriI raw terials that be couldn't afford to buy elseehere. credits to help Tito build new projects all A 10 million nitrate fertiliser plant BigZde, impressive machine factories" equipment for lead dredging equipment for canals' and, biggest of all, and electric power couples. Amway one half billion aid wee promieed, all told. The largest amount try outside the Soviet bloc. That was the promise. to accept the political conditions attached to accept doctrinal donation by his ex. mow the OCOMOMie bait has been yanked paid to the Yugoslays have been all practioel purposes cancelled. 1 visited a coupi of week* ago one of the project* that Russian money was sopposed to ktkr for, a huge 470 million fer- Fgrimaamago0190WatIriajAARMSQ144,514maziOWS1072ecing Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 LEES 0 took as a the it'. copper. I of a tariff an mapper, The Soviets cane vire* Little Ulnas,' has woca as a the United States ham a special tariff and in the first half of this %tgl*y's beat customer* Brasil has coffee to and the Soviet bloc offers to r*tvLrn for oil end precious things like to separate the vs.po the best in either to import Soviet au fOr a teeth Chevy would cost* Communist and tonimstrarauxii Approved For Release 2000/09/11 : CIA?EDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 They flatter these proud Gauntries, with attention and blame back-. urdnees on Yankee imperiali This preparatory stage of the Roble liar is basked * with and with floods etas/ulnas and periodicals filled with mailing Soviet pemsante and happy workers and pictures of big machines that are meet impressteo in undeveloped Gauntries. And Soviet chess Players, dancers, scientists, eoeposers, athletes and ,ionrnalists have been swarming Geer south Amerios in recent months The reason is this: South american governante and businessmen do not want to trade with the Soviet Minn. But **anode neoesaitY kewps pushing thus in that direotion and Macaw wants to convince them that you can do business with the Kremlin. At preunt, only three eountries in Latin Unica have dtptic relet4one with Buda. Chile will OMR .0i/1 UMW and othramay follows Cammunism and Karl 1hrx tat&ck at in all tht* usatcan't hope to communise Catholic Soith America any more tn. it can the Molds= of the Biddle Bast But that's not ??? 23 - Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 And a it builds, .cnriet influence pick. up and the Ifteil intense MaZis but ab is what e source to be plowed back into sore expansion. The phenomenal. In 1950 Russia's gross nath:0a1 of all goods end services* bad gram to a hundred billion dollars, ii third 8441 tench as aeavricats. Six pearl later, both had grown, but Itusida bad cautioned gaining on se, now up to 40 of our total Three years from now, it's reckoned, the Soviet MIP mill be 230 billion, fully ball as mach as ours. It was in February, 194, t the Kremlin rulers ibroally decided to strike the )osture of a kware" nation. Ithrushchev aonwinced hie followers tbat a minims investment, with fleetly, symbolic projects, could provi maxisom. mileage inprojecting an image of Soviet strength abroad, Wilding good wiU, encouraging neutralism increasing tension in the free bier's', widens/nisi lesstern infinenCle. itWI MAY more a, gimmick than a program, typified by this sort of incidents On a tour of Approved For Release 2000/09/11 : Clai-Rjr..62S00545A000100090122-2 Ve Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 11 At a AaStWita/ line untouched t Wawa hands in Savosibirlik the Chioago of Siberia where only a village stood daaaden ago Aad in Sverdlovsk in the Urals Russiafs progma. I stool indettotry real trade program -suffiadency and to face* outward to the Kremlin rulers the specialisation of uo,but with a cautious entry into and a paiitiily-direated foreign aid program,. immodestly publicised. Total bloc commitments ars about $1.5 billion. But spread out over so long A period that the annual cost is only- 200 million. At that rate Russia (toed double her aid with ease. And it. doesult all come from Russia. In f of the machinery from Czechoslovakia and from &at Gersawt Russia's chief lieutenant in the foreign aid campaigns Med China or political reasons - allowed to handle some of the snb..coatracting for Asia. Xbreign Approved Fo4R?Pleaig. 200I4loriC ItaigROPfte.00 5461k0 Ogg CHIMMIXtigedie4 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 SGIrnJut 'D) enoegh themselves, so they can't understand Mndoztta to the other underprivileged 4gmtien aidegraement wee signed the details but not in *scow. On trade the Soviet drive La oLy Her total :amigo% commerce ie still bat there are ominous signs. Aussia's bit ctLo is riai while ours is tallieg. This year her 's output will be 22% to our 3E% Arid that Op is n4*ig. Aussie has started exporting to cutting prime, disterbieg world rkets.But unlike America, which pour. more than 90% of her 1ttn into eor goods, Angela still keep* almminma from the enemas?. her people eook with oast.iron pots and they don't know about aluminom set aluminum exports; next _pi it then what? bility for economic werfare is less than advertised, but it La groving.Runniug ageinst it AM the pressures of the needs of Awl Odra, the post-auwary requirements of th iatsUit.s. at RUISIAL is uneconomic force to be reckomed wi SMITH: Well, in our own nation's cpit?, those in ?barge of our plans to meet the Yasi divided in their concerti Thoy are about 50% the Ausaians will do but they're at least 540% we mey fail or neglect to do ourselves Our huge advantage in this Approved For Release 2000/09/11 : CIA-Ii13*"62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 reciprocal trade program i of age whereby the President is empowered to ]n triff grsdsz to at otbs sell to us to earn dollar* to buy from us with. Xed. to stimulate 6 healthy trade between us and other gen o 24'odu4g at a aid dras question. out of the rebellion is of world record economy has been prodUcing year, while Russia's economy has been AlOWlast year *mats of Representa the usefulness of the whole program into key Senate committee ripped U. insides bill, What Gauped this Ceogreesionel but some wsuggested to ne it was largely carried out by Democrats and large am a protest *pinWt many things the Administration has been doing, not lat. the Presidentis stand ea the adameuGoldfine affair, Mew, in the nett few days these issuee oome up for infal settlement In our Congress. The lest few days or week, therefore will tell Voothor for a year tG Approved For Release 2000/09/11 : CIA1.-413Fr62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 thes forward in her Ruble. on and Gongroso have withheld ons tOO4 MOW, one of tho by Peter bigger run like to ask oonld you strt t into tho an official oall as bask 4 of the rtant f it is so, I think some of the raena &r Southeast Anion country Iambi& He wasn't in and I rtaats I said, The voice' on the *accuse no important forYou- tha paint is I think we've heard and wo have to rtnt to us fighting Ctmommism just isn't to AsLans. !poster of economic domination. it'o in tho the old oolonial master. With its socialist bloc in mom or less absolved of the suspicion of that kind. With Red Chine a major partners say there's nobody here but us Asians. Their they halm a standard of living closer to tho the bloc endorsos the neutral policy of these p *Don't sides; w'11 help you Approved For Release 2000/09/11 : CIA=RtP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 (aINT'Ot iiers we must always justify the foreign aid program ae Cold 4,:ar ammunition publicly in Congress, right in this studio, and the verdict among the .slausin1 Tore not just helping L$. YOu're ;Nat trying to fight the iiU*414U1S.." -aV4-TUt Ack Hottelet, g':)TTLall in Latin America - ''utwalans ere 14icker on their feet than we are. Heres a continent e ts- tieI17 rich in reeouroes that just the water running off the Mader Mountains could lied, up the Western Hemisphere from mad-to.end, in this potential wealth most of the people live in poverty aut they're becoming keenly aware of how mueh they're missing. And the !bassians, spipatnetically, otter them a short cut into this Twentieth Century, ,4uick leap frmm a farm economy- to industrial power and plenty. loviet reality, of course, is far avow - the .rioviet price which is taken out of the hides of the people, an Lan ,chorr *aid. This Is far away, so the $ovist snake oil cimaes to eeem most attractive. *41 on the other hand, come- in toe often atith wagging fingers, telling the Latinos to put their houses in order and pey their debts- and stamp out corruption whioh of course, they take as rich man's advice. It may be very good advise, it -0* the wrong wey. the other hand aur double-ostandard keep* showing. Our price supports and fare inibeidies and protective tariffs are tried up here. but when the other MAU puts his govern- t Into business end. insists on doing things in his own strange way, we- too often look At it ae uicked. Krnest Leiser: IZIL.ER4 Nell, Romani, I W4$ given one reason. Mattis, %salmi Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 spt more eranFt* you Americana," he said dollars, to give a count yo a make one big announcesent and then that's that. Now, the hassians, he said, ?announce that they're their money by at official of tPi. Vest pl. of weeks ago t Ole with that when you havea hundred million go to give a hundred million dollar audit when they first get They make a Dimond amouncement when the country comes to begin negotiations They announce it a third tine when acted. And they announce it a fourth to oe ots the oney, it four hun red mi 11 finally handed over. y the time the country - le think that the i? have given them liars_ instead of a hundred millions -mother, somewhat more serious explanation Yugoslav, who pointed out that the 3oviet money is gevenin th. form of thing* you can eingle Out 571 ?That was ilt by In. the fo identify as oars. 4i ?U: J don' aim aid to Tegoalavial on the contrary, Things that the Yugoslays can't gn on us. It seems to me sometimes tha iieg out of their kind of foreign. aid bee- ie fr* thee it relatively new phencetenon The peopi. are constantly being se4 in the first- place if thy are able to 4o it and, Indian told me is Moscow, that they should want to rtain amount of that extra mileage, I think in a it. Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 it aid program s to be expected. As whenttcoves qu*s or foreign aid, however, I think there theY do Rot *ore rnileagebecause they *trees the fL&ryand gymbolie kind of phenomenons the thing which you can go into both quickly and silyvithout taking any responsibility for an overall foreign aid prograt. AIRDMI the krab world the kneeling are they get maximum publicity out or ry acts of courses is colossal. I think that thatally the reason for their soon s. Th*jr pro a is ccessfUl because ?t' based based on A policy and 13,iroach to foreign aid that's acceptable to the rob government*. The liussiane don't come along and say *Kers ten million Collars; wile * dee with it. " They accept the ideas of the Egyptian* on Whit_ opt needs and what she vents. rurthermore, in these develop- t schemes, the Ruseiens aren't givik anything away. They've I learned I thinks that charity can Do offensive, Their leng-term redit deal with the mittens is 'ow Popular with %apt eimpXY *scowls ostensibly Ws a business arrangement and presume:017 anyway these credits are eventually going to be repaid. And so for Egypt it does not have the odor of poIer patties. And then the Russians do not have the Point Figur on top or the show, the visible representative of r advlsinj, directing interfering and generally Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 making himself a perfect p?litical target for hypersensitive nationalists. I think the Russians are succeeding simply because theymake it seem at least that their economic aid has no political strings attached to it. SMITH: Well, some of the things you've said suggest a ry basic question, that the Russians are simply making their projecte seem so important. Is is possible that Soviet penetration is not really a threat? Could we have some answers on that? Daniel Schorr. SCHORR: W.U, I would put it this think that Soviet penetration is not a quantitative threat I do think it is a qualitative threat. When I say it is not quantitative I mean that they haven't yet reached a point where they have the kind of portable surplus that can threaten us in any way. It's been exaggerated and it will be so for same time to come in spite of all her great gloat. However, when it comes to the qualitative side by stressing the symbols of foreign aid and concentrating on key sensitive areas and especially on tgypt, which Winston has talked so well about, they -can get certain spectacular effects. That is, of course, if you want to consider foreign aid a threat at all. I don't want to raise an irrelevant question at this time but George Kerman, has asked a questionas to whether foreign aid is a threat. Whether perhaps it might not be best to let Hussia get her feet all enmired in foreign aid and, to laza metaphor, to get some of the headaches that we've developed and to get quite enmeshed in the same thing. Perhaps, it might be a good thing, he suggests. Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 - 22 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 tha .at do Alussian penetration into f a eventk Aly here wi a d ie not iii7 s of their di liurionment among the reeipi8nt countries with ,,tuselan help, Lut 1 do not think that we can take aty particLr comfort from that fact and I don't think that we ow ase that bueeiee troubles are going to be a positive help to us. And iertiiUj I do not believe we can afford to let the masiar; go it alone in the Middle %ast Mere is a threat in that area d it going unthallenged by us. 1 thine that we've at to accept the fact that the Russians Are in the Middle Meet as traders* engineers, adviser*, teehnicians. Their presence there is inescapable. i don't think inciAeltaLly, that the mere presence of Soviet technician' is ucti of a threat. The technicdans in e.grpt, for *ample, keep very much to themselves. May are not allowed to circulate or to fraternise. guch more disturbing think, Is the scale an which the missions are now building training schools for industrial workers, exelanging professors lath asab verelties, haneing out scholarships to 4rab students. This year for example, for the first tine there are more flrian students g to :Ioviet-bloc swamis on scholarships than to the schools of he entire Free itmrld and if this gees on we nar find one day that 3yria oeetern-educated middle-olaas has simply disappeared by attrition and Leen replaced by a Soviet-educlted middle-class. Approved For Release 2000/09/11 : CIA-RDP6-2$110645A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 *ally" of count, the throat is simply that if voavr thefi Id of Aid to tho Fussians then some day wo nay ftd that thoy control a largo and critical sector of tho modern f the 4rab oountrios. ;otter,Kalischer, have you any comments on this queeUn or ether kassia is really it throat? i'ALI3C-4.1tt Tee" I think Winston is risht and Kennon iv wrong. asked Prosidont 3akarno of Indonesia it hie thought there win,* tringo attachod to Soviet or American Aid. This was his reply and i tot Lot's be realistio" *hail wo? Ln a eertain SAWN, 1I $dand All trod* haw* string*. Savoie one country supplies our tion sorvico with two dredges. That moans our irrigation servica is tied to that country for spare parts and so on. 9ut if you mean does American or .-ommunist aid cow with the conditions of al or tatlitary support tho answer is a flat no." well L think it io implicit in that *newer that there don't halm to to suoh c If aid goes from drodges to ammo' to heavy industry" all BQppltd by or side the recipient nation io nilly' on that se0 President Sukarno', personal foreign aid phil000phy ie summed up hy something olso he said to sonebo4 He said he was sure the Russians mould build Indonesia a sports tacit= for the 1962 As an samosa and then tho Americans would 3ump at tho chance to Guild them a hot,/ to put the visitors in. And you know he's right ;AIM tapas, 1CM Hottolet - - Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 threat, would The stake in u ask the qu..tiox in term of the ',wrist in terns of vhat's et stake feturea Ale well known that we have skimmed the ere of our natural resources and: our reserves are obviously diminieb .ng from dep4o.?day? The Latin Aaerican continent is our but, our nearest and ult a:y tour vital wares of supp*y right now. LAlin Ameriea is the cnd bigeest market tor our goods And its twenty publics_ are our firm friends and rters in the United Nations, which is, t.rrlbly important right t this instants te can help these be it shining examl ej we can help them be AM opportunity for us; an example to the un loped nations of afriea. and 4Sia that frted04 too offers sperity and a better one than the Soviets have to offer. Jrt the other hand if ws lose Lati eric&1 we lose a great deal, argot t at if the 3ov1.sts wore ever to assert their tnf1uce on Latin Vmerica American 5earity would be et an end The, ' t Leiser. Howard tion is no L' non-Soviet Er?pe, except Afl I have indicated in Ice' . aelly the Luropeans reel a. deal the Ito t its less of a threat thoughout the world ft* we make it appear to be. They sey that the amount of credit the Soviets loan actually extend Is meager compared to vhat we 0. Aftd that because of the needs of iJusela's own growing ttlat this is; going to continue to be the case for a long time. Approved For Release 2000/09/11 : CIA-RDP62800545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 and th ropeeneconomists o*rncde that s lective in pieking out eireconomic targets the most of thee in propogonda point of view. Oy and large, the attitude in !rope is that expreesed a couple of we*kv ogO in Thg 19qApip LARnprOtt, which le a prettd sober and sensible publication. It ended a piece on Ian economic ertetration with this comment; "The Soviet eeonLc challenge Cfttt4deep concern, in the long rot, only if the stern instrti conomies fail to keep on growing themielv tor a foreign aid he very bosic and simple quortiqn is oelng asked all over thi and see that corruption in Aould we not abanthn the whole idea if it does not wtn friends '411A yo d gentlemen have been out of this country et. me tell you that in the gathering struggle ov ond I want to pat that qetton to you now n?ver are. Is there not too much waste and ti sid? Pees it reAly yield Its any benefits? for is and Follaais,oan relly get more mileage with le aid to others than we 4ve7 What do you think of thot? tAnton EUrdett. d,:rrt ell lioward, as I said, In the three countries boon talking about there is no American oid pro-srao and there- for, thereto no corruption think there should be an aid program tfo*r because otherwise, ve MA:f find that UM eountries have no Ltcrnatie, no p1e. to torn exzept to ?scow. Kolieeher. 411 in AlliS e end some U n forst aid. Therese waste and corruption in the Approved For Release 2000/09/11 : CIA-RD11,400545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 United Ste a quarter scadal I don't point is Vat *veil we ahould stop giving the United. States Ar ely In: CaMbodia lemre a few minutes up y03 saw tt large pile of rotting aid equipment tiNe Chinese Communists, ate nese aid goods and erriug the proceeds to. the Ceibodians. ?coeds in loeal, curreney, they are turniag them over to bal governors In CaMbodDx for their own local, a14 prO to, be spent ver e hey see it aed no accounting to is foreign aid pork barrelligg ls on a soele I te, But t4e point is: Vat the Chimebe are not to CeMbodia if some of that money so 1d going to cut of to turn uv in the Calbodien eqeivalent of deep freemera or ts. SHIM: Dick BOTTELET: Weli, I tiink even tte vt Peter :as said uae over- eormottoa Le Levin 44erioe reac rovortions you could well mil ei Vssre's a story that the onAy train that really rune ii1 in Ltth America is te, gravy train. It affects private etarris I t ayjust as emeh as it does gmverament, sad it does not affect aid program. Rut la az y cams in Latia Aerie& great grants Id are not the answer. t Leiser. well ecutally Howard as you know, one of the remarkable esj.eets of our zeige sAL programa in Europe :1,as been that there's been v1rtti.iy no careuption. Mike Tegoslevie as just one example. We pick many. We turned over $782 millioo In economic aid to lava in poet eight years, end there hasn't been a single Approved F81814416aggilOa0tt/*: all'121R6firs - 27 - Is III 1 III Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 for a uxury hotel In Beigrode W;i they don't really need,cuid been better uned. But tee fact remain% that during a veri trying to break Tito economioelly, ww aept Tito 's country after all, that %ea whet we set out to ao. If I oould add one word oere, Howard. Alto Soviet foreign ald, I would say one thtag - thoot or don't tiAnt, is any monopo44Gfr1 CIU foreign We 1Jw* auad out .;ust from seeing wbat's ned In Burme 116,43e lied up on docas, only to got wet and be useleon. We .:;een earl re0 macinery on farms in India that couldn't be used because o farm big enouC to ume it, just some of the outward yabols of waste ovet foreign aid. There hoz never been ay kind by tteir perlieteat, by their Sovremenroovlet. I don't tthktht leo Lato get too alarmed about a little veste, it's good mils to .-,ear about vice elsewhere. SMITH : you o:A-4 z mode, We- Well, In the few moment-, remeining to tie 1' tet te an economic policy or the United StM*c that w .11 Rdble Wr. Now, beeiJog la mind the crittion. you d You sUBBest tat wo 40 that we're oot nov dOlne Daniel.. Schorr,. would you start, SCHORR: Well sir, '11 write you a ,74t-pe because I briog of urzy after having lived a c lole of yea:o ftaala rg exletrienced their climate. 4e owl' tt-ts a ruble Jeer, i ts & rdble ear let's use same of the geoheaiseo Of mar. 1 would at we forma Mod, not we, but the United State form some dioatioglamkr, perraps called the Foreign Boonomi? tiog Board built oolong tiIloes of the War Production Board of World War Tye, And that this body be given the job of coordinating Approved For Release 2000109/11 : CIA-RDP62S00545A000100090122-2 -? 28 - Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 all ign aid projects? all these of the t and also enlisting privaLte indnetryi bringing it in to do the jeb that cannot be done by government. I mould suggest that if necessary- that me give these indus tries something like coat-plus contract to go into tho underdeveloped areas and do the kind of work that couldeft be done by inametrIrtwommo there would be no incentives I speek of incentive because- in our society because it is- e democratic. oc1*ty1 it requires incentive. And 1 any the mcet profound problem me face is to find the mechanism Wit the, impact end the concentration on. target- areas by c means that the RUSSUAS today get by regimentation.- think it can be dame and I think it fumiamentally important fcr that kind of thiAg.nnet be done. durdett at do you think about %hie Set la Approved For Release 2000/09/11 : CIA-762S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 great big ?crflnsti throw, sway many of .ry to begin all over ther I very hippy with what ion. It doesn't seem to be tion or that what it gvrtnt agency. I think old idesi about how to edeinieter am. And Its going on the assumption that cmr atm has to be to find alley of extending help that is so flexible and so presentable to foreilphftentries that we eau b.Egypt for example* OTO4 when we don't liks lesser and can go on b.iping d?pite the up* mod downs of politica I **June that we either hsve to do tt*or that ve have to abandon the VW to the RUSSIOMX, of r ideas spring from Marshall Plan experiences -which were *U rit. Those ideas were all right for Europe but for the parts of the w'1d thatwe've been discussing* they Inly don't fill the bLii. Tb f thing I think* is that evonomio aid meet? be detached from politic far as possible. The administering of aid ought to be t*ken out of the hands of policy-making bodies and as far as possihde out of the field of adminietration, orients and eharity should go Thtra should be new and flexible 1oai and credit arrangements interest* We should give private ent.rpri.e a way to oeibat the Soviet drive and government aboul4make it morthuhile for private enterprise to do so That mmy see like a rather eztsv*gant idea, *t the West have done exactly thet by quite a are the only ones in the Middle East who are now providing a check to the t offensive there.. The German operations in Egypt* which he's Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 - Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 4 a th lor use Mt Dan, I think you deserve a ten.second rebuttal to that answers SOttts In tan seconds, I mould only *ay, Winston, that I don't think me ere in any basic disagreements I 'mould only say that I dont think that coordination is the opposite of flazibility. And think that what has been done in went aernany can be done in our may too providing incentives to private industry Stant Peter galleohers Can you holp ii rtte a policy nes7 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 KA think we've set to attract young American engineers in.the-foild men, into foreign aid service, perhaps through holarshipe with the first two years after graduation going overseas. All through ketheast Asia, I heard one univeraal American to-Chalets= mere too high priced, lived too high, while mould go anywhere, thsy didn't *Ind the neeqpitooe. Well one private American technician I know, vas getting two a month Psi sure as worth it but him oontrect Uovernment to give him commensurate housing cia1 *aid,*ion sorry, but I *** afraid President Sukarno hsv* to mote out of Merdeka Paseo* We don't have commensurate dollars a month* A Mirenve asked me ghat had pd t? th Ai'tanmixelonery .pirit. Be said that Dr, Gordon Sea. goon Seagraves mho is 111 up in the :Shan Mille with in good will to the United States about thirty Milton do11s, at. nt aid prices* I don't think that ell the high vei piamt *111 beat the Commentate in the Milne tar unless we can go into the field, at the level of the pecple eyz trying to sip1 and slag it out ulth their gloves and their air HOTTM Ts The first thing to do is clean out a lot of cobwebs looking at aouth America in terms of Carmen Mirenda, rhumba rhythm and banana revolutions* Pert,r years from now, Latin America mill have twice the population of the United states acid at least twice the natural sources* Its growinb pains are terrible but we got to share then in cur mutual iftterest* Approved For Release 2000/09/11 : CIA-RDP62S00545A00010009012 32 Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 'D) s s at le we're dealing itba got to proud and sensitive as We ain't them but we still enjoy nervous Latin Americana ere we make the new world timid. Welve always the obis* Look at ?Man ?1, iti high time to write thm rulsefor Hemisphere. he nine tan scathe et a time in W?sahingt, lieb. Washington is the pi&cu blame rests When the leen la turned and it needn't be a new oneat all roads transport power, fee put responsibility in Latin American support it with our loam grants in every serious ;rliwet no me ter how unorthodox it may be, whether it be national, private or ination of both. Of course there'd be a riak. drat it would get *V&7 from the eld Park.aserieen bromides and for the first time rally lea in a prograa of common actions various would benefit. rcr us that we have five million unemployed hero at bows Americane need every dangle nsehine be eau build Let tr. Iso b a vast Increase in ezehangee among students, professors, ngineers sponsored by government and the big d*t1on s4 by pristm industry because the Latin Assericens are as gmorent of le as we are of them. Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 33 we've ne- *WO to fit the back ea that t oX the wee Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 WITH Well, I'm going to sun up from his side .erexel well one fundamental thing we can do Howard obviously, la to enlist our more prosperous European allies in a, joint program of eounter-penotration in the uncommitted countries. Winston has telked *bout it the West Lemma= are doing, but actually they've just begun be their government subsidised industrial credits for kgypt. They can do a lot more, end I've been told by their *Metals that they een be persuaded to do a lot mere in concert with us. We don't ned anew Marshall Plan of American gifts. We do need and could get a new Atlantic lien= plan of generous but intelligently directed long term ereditm Wells gentlemen, I would like to try to sueserise acne of the thin? you've said. You've painted a strange picture* We've been by Russia to a contest of economics in which all the Main basic adeantages are on our side we have the hugest production for use in thie contest of any nation on eerth and of may nation in history. And despite Sputnik our geberal know-how to cenvey to *there is itill undoubtedly the world's best. But our advantages, you say, are being smelled out by new things Burdett and Rottolet suggest that in the middle test mad Latin America it is simple default by us. were barely working uhile the Russians are busily ingratiatIng themeless with nem proset1 The wuseians are dealing in loam, far the in part which $o not offend sensitive national pride of emu =time while we de* mainly in aid which bears the stigma of charity. Our teebnialsna nest live and work oo *high managerial level in thaw countries while Russia's tend to -wick an sem% more modest seals uhere the people happen to be, And finally, the Bunts= sinplydranstise their effort Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2_, - 34 Velure) Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2 rrn (iVT)1 mar th.n im do. rDest Leiser made LI military vhich sounds contradictory is. Re saidl we should not try to discourage our from increasing their trade with Russia in non- needed, amp' situation, X have two to add Zx this hare to be aroused to the urgent necessity of this effert which the American people are not aroused to at the present time. Congress it eeems to me, most be made to valise that the effort is a necessary and regular part of our national lite. We should not have to debate foreign *id and reciprocal trade as strange, new, controversieleroposals each yew. They mit become ocemenplaces, regular, natural 'things to do Debate on than should not be ae to whether they should be done; it should be limited to that is the moat affective way to do them. America has risen to maey unexpected world rsaponsibilities in the past decade nd we have becalm accustomed to even when we start licked ut to this challenge we will eartainlytave to rise mach taster than wetye been doing at present or we apy lope the Ruble W. Good evening Approved For Release 2000/09/11 : CIA-RDP62S00545A000100090122-2